It's a pet peeve of mine when substantial facts of US court decisions are misreported because I like to believe that at least upper-court decisions are well-reasoned. Note that IANAL so this is based mostly on a layman's reading of the actual Appeals Court opinion:
http://www.courthousenews.com/home/OpenA...sID=130022
In this case, the radio station violated existing city code (which disallows any sign larger than 75 square feet) with a sign that was 375 square feet, FIVE TIMES LARGER than what was allowed. So the comparisons that are being made to commercial billboards are not valid, presumably if there was a 375 sq ft. billboard for anything else, the city would also have had it taken down.
The radio station filed suit with two key arguments
1) The city code is not allowed to place size limits on signs, since it violates free speech.
2) Even if the city is allowed to have size limits, they selectively enforced the regulation with an intent to discriminate against the radio station.
In the first argument, the court ruled that it is permissible to place limits on signs as long as the limits did not discriminate based on the content of the sign. In this case, the limits are based on a desire to preserve the aesthetics of the neighborhood and traffic safety.
In the second, the court ruled that the radio station did not provide any evidence that enforcement was selective, presumably because they did not present any evidence that there were other oversize signs that the city had allowed. I didn't dig into the original filing to see whether they could have made a stronger case here.